Competency-Based Assessment: What It Is and Its Benefits

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A significant mismatch between the capabilities possessed and needed by businesses creates challenges for organizations everywhere. In order to resolve this issue, many successful companies utilize competency skills assessments in recruitment processes. 

Competency refers to the ability to employ a combination of skill, knowledge, and capability to perform a task effectively in a distinct work environment. Competency assessments are the appraisal of one’s capabilities versus the job’s competency requirements, usually assessed against a comprehensive competency model.

Competency assessment tests are unique as they evaluate personnel on distinctive needs for a job, measuring one’s capabilities against the role requirements. They are suited for new hire candidates as well as current employees to identify any skill deficiencies.

The advantages of competency testing are: 

Equality. They follow a task-centric approach, offering an equal and fair chance to all. Each individual is evaluated on the same parameters, resulting in reliable competency assessment data while utilizing benchmarked capability analytics for business decisions. 

Efficiency. They simplify the assessment of candidates at scale as it is easier to benchmark performance versus a competency model. It becomes particularly significant in new hiring as it identifies the individual meeting the target level in a timely manner. 

Relevancy. As opposed to generic skill testing, competency tests evaluate the employees on a task they would perform in their role. Organizations obtain more dependable performance benchmarks, and candidates gain actual insight into their job requirements.

The challenges of competency testing are:

Rigidity. Competency tests are rigid by design, making it difficult for candidates to stand out. In addition to being boring, they can miss a skill gap if the test taker gives the correct answer mistakenly. 

Aligned prospects. For a competency test to be useful, all test takers must share the same prospect on what is good. It is essential that everyone understands the task’s scope and quality, so they know what they are striving toward and modeling can be tested successfully.

There are numerous ways in which competency assessment tests can be utilized to encourage organizational growth. Following are the five most common use cases. 

Evaluation of Candidates During the Hiring Process

Contemporary approaches to employee recruitment ensure that candidates possess the warranted knowledge, skills, and capabilities to perform a job. As opposed to typical job task analysis, competency assessments provide a more accurate approach to assessing if an individual can perform adequately in the role. 

Recognizing Company-Wide Skills Gaps

Whether meant for appraising organizational capability, designing existing and future jobs, or communicating organizational strategies, competency assessment facilities organizations in recognizing employees’ skill gaps and skill improvement needs.

Assessing Job Performance

A role-centric competency model offers an effective approach to measuring employees’ performance during appraisal. In addition to being impartial, it also provides a strong benchmark to compare progress between appraisals.

Comprehending Employee Career Progression

Competency tests provide an excellent opportunity for managers to work with employees to pinpoint employees’ performance gaps and develop learning plans to support their career development. This process contributes to a broader talent management strategy, utilizing skills gap analysis to encourage a consistent learning culture and curtailing employee turnover.

Delivering Rapid Onboarding

During onboarding, competency assessments are an effective tool for evaluating the aptitude of new employees. Furthermore, they establish a benchmark for hiring managers to evaluate progress, recognize training needs, and identify when a new employee can perform on their own.